"Temasek's problem--and advantage--is that it is 100% owned by Singapore's Ministry of Finance. Its board is studded with bureaucrats and businessmen." Eric Ellis
[March 10, 2006]
Thailand: Economist says Singapore should speak out on Temasek Holdings' takeover of Shin Corp
(Thai Press Reports Via Thomson Dialog NewsEdge)Section: General News - Local economists on March 8 urged the Singaporean government and Temasek Holdings to break their silence before the simmering anti-Singaporean sentiment gets out of proportion, The Nation reports.
Sompop Manarungsan, an economics lecturer at Chulalongkorn University, suggested that the Singaporean government and state-owned Temasek Holdings should end their silence over the controversial sale of Shin Corp to Temasek, the deal that sparked the current political turmoil. Temasek has to provide more information to the Thai public about its investment intentions in Thailand and its broader business strategy.
He said Temasek should also to make clear the Singaporean government's role in Temasek Holdings.[see above for answer.] "The Thai public has questions about the transparency of Temasek and the Singaporean government," Sompop said. He warned that public resentment against the Shin Corp deal could lead to a boycott of Singapore's interests beyond the Shin Corp empire.
"It would be a great loss if other businesses - in which both sides mutually gain - would also be hurt," said Sompop.
Somkiat Tangkitvanich, researcher at the Thailand Development Research Institute, said Temasek should consider selling off sensitive businesses such as iTV and other enterprises that use Thailand's limited resources New buyers have to be accepted by Thais, he suggested. Somkiat agreed with protestors who are threatening to boycott products and services of Singaporean businesses to express their disapproval of the Shin Corp deal.
Aat Pisanwanich, economist at the University of the Thai Chamber of Commerce, said Thais felt that Singapore was using its financial clout to take advantage of the weaker Thais.
"A threat of boycott could be real and it will hurt AIS, the operator of largest mobile phone system [in the country] and part of the Shin Corp empire. A large numbers of academics and students in Bangkok who have joined the rally against caretaker Prime Minister Thaksin Shinawatra are currently customers of AIS," said Aat.
Moreover, the campaign against Thaksin will not end soon, and therefore Temasek faces higher risk, he said. Aat surmised that Temasek wanted to pull out of the deal.
An investment analyst from a research institution in Singapore told The Nation, "I am also worried about the impact this might have on bilateral relations going forward. Even after the saga ends, there may be some negative attitudes towards Singapore . . . I hope that bilateral relations will withstand this unpleasant period." Senator Kraisak Choonhavan predicted that Temasek Holdings might find it difficult to unload two problematic subsidiaries - Shin Satellite Plc and iTV Plc - because the two are not a good buy. Many Thais have expressed concerns over the sale of the two companies that are deemed part of the national security.
Kraisak said at a meeting with foreign chambers of commerce that eventually Temasek would have to sell the two companies because under the foreign business law, foreigners are not allowed to hold a major stake in them. For instance, foreigners can own only up to 20 per cent in a broadcasting business, which will directly affect Temasek's acquisition of iTV.
"The only legal sale in this deal is Advanced Info Service Plc," he said.
However, the other two companies are not a "profitable buy" because of their financial burdens. For instance, iTV still has an overdue concession fee of Bt450 million on its books.
The People's Alliance for Democracy has threatened to launch a campaign against Singapore on March 9 if it does not drop the Shin Corp deal.
Meanwhile, Lim Hwee Hun, Singapore's minister of state for finance and transport, on Tuesday met with Finance Minister Thanong Bidaya, who refused to say if they had discussed the Shin Corp- Temasek deal.
4 comments:
It's certainly a problem but nothing that we can't ride out. Just wait a few months and it'd blow over. However this underlines the deep suspicion that our closest neighbours have for us. I don't want Temasek to be out of government hands-certain industries needs to be nationalised to ensure that greed does not trump public need.
I look at the Internet access here and whilst it isn't the cheapest, it's much much better than in the US where it's a virtual monopoly and telcos bleed money from customers.
But with influence comes resentment, i 'm all for Temasek to expand aggressively but politics will always get in the way..
while temasek pays some dividend to the treasury so that it contributes to government budge, much of its surplus (profit and proceeds of share sales) has gone into overseas expansion, which provides jobs for trusted servants, but not public largess; if its expansion keeps producing diplomatic problems, regardless of all the clarifications that temasek makes its own decisions on commercial considerations which may or may not cut any ice with regional demonstrators, the public may well ask "where's the beef?"
Meanwhile, Lim Hwee Hun, Singapore's minister of state for finance and transport
http://www.cabinet.gov.sg/
Where is Lim Hwee Hun, the minister of state for finance and transport?
Power to the Thais. They realise the dangers of any govt playing a key role in the economy by being a large, active player.
Nary a peep from Singapore citizens.
They like their Temasek to play regional corporate games, and grow bigger and richer, and more powerful.
Silly buggers. For the sake of freedom - economic and political - the wealth should be held privately - amongst the residents of the territory, and perhaps some foreigners, if they so choose.
Not so in S'pore: the citizens keep voting PAP. The state gets richer (and to be fair, so do the people), revenues increase, its GLCs more powerful and any dissent peremptorily SILENCED.
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